                                 CODE OF VIRGINIA

CREATION AND PLAN OF OPERATION OF JOINT UNDERWRITING ASSOCIATION (§ 38.2-2708)

A. After providing notice and opportunity to be heard and upon promulgation of
an order by the Commission pursuant to &#xA7; 38.2-2707, a joint underwriting
association shall be created consisting of all insurers licensed to write basic
property insurance or other insurance that contains a basic property insurance
component in this Commonwealth, but excluding insurers exempted from rate
regulation by subsection C of &#xA7; 38.2-1902. Each insurer that is required to
be a member of the joint underwriting association shall remain a member as a
condition of its license to write basic property insurance and other insurance
that contains a basic property insurance component in this Commonwealth.

B. The joint underwriting association shall, pursuant to this chapter and the
plan of operation, have the power to (i) cause its members to issue policies of
basic property insurance on qualified property to applicants; (ii) assume
reinsurance on qualified property from members; and (iii) cede reinsurance.

C. 1. Within ninety days following the effective date of the order of the
Commission, the joint underwriting association shall submit to the Commission
for its review a proposed plan of operation consistent with this chapter. The
plan of operation shall provide for economical, fair and nondiscriminatory
administration and for the prompt and efficient provision of basic property
insurance to promote orderly community development. The plan of operation shall
include, but not be limited to, (i) preliminary assessment of all members for
initial expenses necessary to commence operations, (ii) establishment of
necessary facilities, (iii) management of the joint underwriting association,
(iv) assessment of members to defray losses and expenses, (v) commission
arrangements, (vi) reasonable underwriting standards and limits of liability,
(vii) acceptance and cession of reinsurance, and (viii) procedures for
determining amounts of insurance to be provided.

   2. The plan of operation shall be subject to approval by the Commission after
   consultation with affected individuals and organizations, and shall take
   effect ten days after its approval. If the Commission disapproves all or any
   part of the proposed plan of operation, the joint underwriting association
   shall within thirty days submit for review an appropriately revised plan of
   operation. If the joint underwriting association fails to submit a revised
   plan, or if the revised plan is unacceptable, the Commission shall promulgate
   whatever plan of operation it deems necessary to carry out the purposes of
   this chapter.

   3. The joint underwriting association may, on its own initiative or at the
   request of the Commission, amend the plan of operation. Any amendment to the
   plan of operation shall be subject to the Commission&#8217;s approval.

HISTORY: 1968, c. 559, § 38.1-750; 1973, c. 504; 1986, c. 562.